To

The Members of Sarthak Industries Limited

Report on the Financial Statements

Opinion

We have audited the accompanying financial statements of Sarthak Industries Limited(“the Company”) which comprise the balance sheet as at 31st March 2022 and thestatement of Profit and Loss (including other comprehensive income) statement of changesin equity and statement of cash flows for the year then ended and notes to the financialstatements including a summary of significant accounting policies and other explanatoryinformation.

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by the Actin the manner so required and give a true and fair view in conformity with accountingprinciples generally accepted in India of the state of affairs of the company as at 31stMarch 2022 and its profit (including other comprehensive income) the changes in equityand its cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Companies Act 2013. Our responsibilities under thoseStandards are further described in the Auditor's Responsibilities for the Audit of theFinancial Statements section of our report. We are independent of the Company inaccordance with the Code of Ethics issued by the Institute of Chartered Accountants ofIndia together with the ethical requirements that are relevant to our audit of thefinancial statements under the provisions of the Companies Act 2013 and the Rulesthereunder and we have fulfilled our other ethical responsibilities in accordance withthese requirements and the Code of Ethics. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the financial statements of the current period. These matterswere addressed in the context of our audit of the financial statements as a whole and informing our opinion thereon and we do not provide a separate opinion on these matters.

Information Other than the Financial Statements and Auditor's Report Thereon

The Company's Board of Directors is responsible for the preparation of the otherinformation. The other information comprises the information included in the ManagementDiscussion and Analysis Board's Report including Annexures to Board's Report CorporateGovernance and Shareholder's Information but does not include the financial statementsand our auditor's report thereon.

Our opinion on the financial statements does not cover the other information and we donot express any form of assurance conclusion thereon.

In connection with our audit of the financial statements our responsibility is to readthe other information and in doing so consider whether the other information ismaterially inconsistent with the financial statements or our knowledge obtained during thecourse of our audit or otherwise appears to be materially misstated.

If based on the work we have performed we conclude that there is a materialmisstatement of this other information we are required to report that fact. We havenothing to report in this regard.

Management's Responsibility for the Financial Statements

The Company's Board of Directors is responsible for the matters stated in section134(5) of the Companies Act 2013 (“the Act”) with respect to the preparation ofthese financial statements that give a true and fair view of the financial positionfinancial performance changes in equity and cash flows of the Company in accordance withthe accounting principles generally accepted in India including the Indian AccountingStandards (Ind AS) specified under section 133 of the Act read with the Companies (IndianAccounting Standards) Rules 2015 as amended. This responsibility also includesmaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding of the assets of the Company and for preventing and detecting frauds andother irregularities; selection and application of appropriate implementation andmaintenance of accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the financialstatement that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

In preparing the financial statements management is responsible for assessing theCompany's ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless managementeither intends to liquidate the Company or to cease operations or has no realisticalternative but to do so.

Those Board of Directors are also responsible for overseeing the Company's financialreporting process.

Auditor's Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financialstatements as a whole are free from material misstatement whether due to fraud or errorand to issue an auditor's report that includes our opinion. Reasonable assurance is a highlevel of assurance but is not a guarantee that an audit conducted in accordance with SAswill always detect a material misstatement when it exists. Misstatements can arise fromfraud or error and are considered material if individually or in the aggregate theycould reasonably be expected to influence the economic decisions of users taken on thebasis of these financial statements.

As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:

a. Identify and assess the risks of material misstatement of the financial statementswhether due to fraud or error design and perform audit procedures responsive to thoserisks and obtain audit evidence that is sufficient and appropriate to provide a basis forour opinion. The risk of not detecting a material misstatement resulting from fraud ishigher than for one resulting from error as fraud may involve collusion forgeryintentional omissions misrepresentations or the override of internal control.

b. Obtain an understanding of internal controls relevant to the audit in order todesign audit procedures that are appropriate in the circumstances. Under section 143(3)(I)of the Act we are also responsible for expressing our opinion on whether the Company hasadequate internal financial controls with reference to financial statement in place andthe operating effectiveness of such controls.

c. Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by management.

d. Conclude on the appropriateness of management's use of the going concern basis ofaccounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe standalone financial statements or if such disclosures are inadequate to modify ouropinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditor's report. However future events or conditions may cause the Company to cease tocontinue as a going concern.

e. Evaluate the overall presentation structure and content of the standalone financialstatements including the disclosures and whether the standalone financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation.

We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence and to communicate with themall relationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards.

From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the financial statements of thecurrent period and are therefore the key audit matters. We describe these matters in ourauditor's report unless law or regulation precludes public disclosure about the matter orwhen in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

As required by the Companies (Auditor's Report) Order 2020 (“the Order”)issued by the Central Government of India in terms of sub-section (11) of section 143 ofthe Companies Act 2013 we give in the Annexure A a statement on the matters specified inparagraphs 3 and 4 of the Order to the extent applicable.

As required by Section 143(3) of the Act we report that:

a. We have sought and obtained all the information and explanations which to the bestof our knowledge and belief were necessary for the purposes of our audit.

b. In our opinion proper books of account as required by law have been kept by theCompany so far as it appears from our examination of those books.

c. The Balance Sheet the Statement of Profit and Loss (including Other ComprehensiveIncome) Statement of Changes in Equity and the Statement of Cash Flow dealt with by thisReport are in agreement with the books of account.

d. In our opinion the aforesaid standalone financial statements comply with theAccounting Standards specified under Section 133 of the Act read with Rules framed thereunder.

e. On the basis of the written representations received from the directors as on 31stMarch 2022 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2022 from being appointed as a director in terms of Section164 (2) of the Act.

f. With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate Report in “Annexure B”.

g. With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financialposition in its financial statements - Refer Note 34 to the financial statements;

ii. The Company did not have any long term contract including derivative contract forwhich there were any material foreseeable losses.

iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company.

iv. (A) The management has represented that to the best of its knowledge and beliefno funds have been advanced or loaned or invested (either from borrowed funds or sharepremium or any other sources or kind of funds) by the Company to or in any other personsor entities including foreign entities (“Intermediaries”) with theunderstanding whether recorded in writing or otherwise that the Intermediary shall:

• directly or indirectly lend or invest in other persons or entities identified inany manner whatsoever (“Ultimate Beneficiaries”) by or on behalf of the Companyor

• provide any guarantee security or the like to or on behalf of the UltimateBeneficiaries.

(B) The management has represented that to the best of its knowledge and belief nofunds have been received by the Company from any persons or entities including foreignentities (“Funding Parties”) with the understanding whether recorded inwriting or otherwise that the Company shall:

• directly or indirectly lend or invest in other persons or entities identifiedin any manner whatsoever (“Ultimate Beneficiaries”) by or on behalf of theFunding Party or

• provide any guarantee security or the like from or on behalf of the UltimateBeneficiaries; and

(C) Based on such audit procedures as considered reasonable and appropriate in thecircumstances nothing has come to our notice that has caused us to believe that therepresentations under sub clause (iv) (A) and (iv) (B) contain any material mis-statement.

v. The company has not declared or paid dividend during the year hence provision ofSection 123 of the Act not applicable.

h. With respect to the matter to be included in the Auditors' Report under Section197(16) of the Act In our opinion and according to the information and explanations givento us the remuneration paid by the Company to its directors during the current year is inaccordance with the provisions of Section 197 read with Schedule V to the Act.

Annexure A to Independent Auditor's Report

Referred to in paragraph (1) under the heading of “Report on Other Legal andRegulatory Requirements” of our report of even

date to the members of Sarthak Industries Limitedon the financial statements for theyear ended 31^st March 2022.

I.

a. A. The Company has maintained proper records showing full particulars includingquantitative details and situation of

Property plant and equipment.

B. The Company has maintained proper records showing full particulars of intangibleassets.

b. According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the Company has a phased program for physicalverification of the PPE for all locations. Physical verification of the assets has beencarried out during the year pursuant to the programme which in our opinion is reasonablehaving regard to the size of the company and nature of its assets. No materialdiscrepancies between the book records and the physical inventory have been noticed. Inour opinion the frequency of verification is reasonable.

c. According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the title deeds of immovable properties (otherthan properties whether the company is the lessee and the lease agreement are dulyexecuted in favour of the lessee) disclosed in the financial statements are held in thename of the Company.

d. According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the company has not revalued its Propertyplant and equipment or intangible assets during the year.

e. According to the information and explanations given to us and as explained to us noproceedings have been initiated or are pending against the company for holding any benamiproperty under the Benami Transactions (Prohibition) Act 1988 (45 of 1988) and rules madethereunder.

ii. a.The inventories have been physically verified by the management at reasonableintervals during the year. The coverage and procedures of physical verification of theinventories followed by the management are reasonable and adequate in relation to the sizeof the Company and nature of it's business. As per the information and explanations givento us and on the basis of our examination of the records no discrepancies of 10% or morein the aggregate for each class of inventory were noticed on physical verification ofinventories as compared to book records.

b. During the year the Company has been sanctioned working capital limits in excess of'5 crores in aggregate from banks on the basis of security of current assets. TheCompany has filed quarterly returns or statements with such banks which are in agreementwith the books of account other than those as set out below.

iii. During the year the company has not made any investmentsgiven any guaranteeorprovided any security or granted any loan or advance in the nature of loans to companiesfirms Limited Liability Partnerships or any other parties.

a. In our opinion provisions of para 3 (iii) (a) to (d) of the order are not applicableto the company.

b. No loan or advance in the nature of loan granted which has fallen due during theyear has been renewed or extended or fresh loans granted to settle the overdue ofexisting loans given to the same parties.

iv. In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of section 185 and 186 of the Act with respectto the loans granted and investments made. The company has not provided any security orgranted any guarantee in terms of section 185 and 186 of the Act.

v. In our opinion and according to the information and explanations given to us theCompany has not accepted deposits from the public within the meaning of Section 73 to 76or any other relevant provisions of the Companies Act 2013 and the Rules framed thereunder. As informed to us no Order has been passed by the Company Law Board or NationalCompany Law Tribunal or Reserve Bank of India or any court or any other Tribunal.

vi. We have broadly reviewed the cost records maintained by the Company pursuant to therules made by the Central Government under sub-section (1) of Section 148 of the CompaniesAct 2013 and are of the opinion that prima facie the prescribed records have been madeand maintained. We have however not made a detailed examination of the cost records witha view to determine whether they are accurate or complete.

vii. a) According to the information and explanations given to us and the records ofthe Company examined by us in our opinionthe Company is regular in depositing undisputedstatutory dues including Goods and Services tax provident fund employee's stateinsurance income tax service tax duty of customs duty of excise value added tax cessand any other statutory dues with the appropriate authorities. There were no undisputedstatutory dues in arrears as at 31st March 2022 for a period of more than six monthsfrom the date they became payable.

b) According to the information and explanations given to us and the records of theCompany examined by us there are no dues of Goods and Services tax provident fundemployee's state insurance income tax service tax duty of customs duty of excisevalue added tax cess and any other statutory dues which have not been deposited withappropriate authorities on account of any dispute except detailed as follows :

# Net of amount deposited Rs. 157.35 lacs.

viii. According to the information and explanations given to us and the records of theCompany examined by us there were no transactions relating to previously unrecordedincome that have been surrendered or disclosed as income during the year in the taxassessments under the Income Tax Act 1961 (43 of 1961) and hence reporting under clause3(viii) of the Order is not applicable to the Company.

ix. a. According to the records of the company examined by us and as per theinformation and explanations given to us the

Company has not defaulted in repayment of loans and borrowings or in payment ofinterest thereon to any lenderand hence reporting under para 3(ix) of the Order is notapplicable to the Company.

b. The company is not declared a willful defaulter by any bank or financial institutionor other lender.

c. According to the information and explanations given to us and the records of theCompany examined by usthe term loans raised during the year were applied for the purposefor which the loans were obtained.

d. According to the information and explanations given to us and on an overallexamination of financial statements of the Company we report thatfunds raised for shortterm basis have not been utilized for long term purpose.

e. According to the information and explanations given to us and the records of theCompany examined by us thecompany has no subsidiary joint venture or associate company.In our opinion provision of para 3 (ix)(e) are not applicable.

f. According to the information and explanations given to us and the records of theCompany examined by us thecompany has no subsidiaries joint ventures or associatecompanies. In our opinion provision of para 3 (ix)(f) are not applicable.

x. a. In our opinion and according to the information and explanations given to us andthe records of the Company examined by us the company has not raised money by way ofinitial public offer or further public offer (including debt instruments).

b. In our opinion and according to the information and explanations given to us and therecords of the Company examined by usthe company has not made any preferential allotmentor private placement of shares or convertible debentures (fully partially or optionallyconvertible) during the year.

xi. a. During the course of our examination of the books of account and records of theCompany and according to the information and explanations given to us no fraud by theCompany or on the company noticed or reported during the year.

b. No report under sub-section (12) of section 143 of the companies Act has been filedin Form ADT-4 as prescribed under rule 13 of Companies (Audit and Auditors) Rules 2014with the Central Government.

c. As represented to us by the management there are no whistle-blower complaintsreceived by the company during the year.

xii. In our opinion and according to information and explanation given to us and therecords of the Company examined by us the company is not a Nidhi Company therefore theprovision of para 3 (xii) of the Order is not applicable to the company.

xiii. According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the financial statements as required by the applicableaccounting standards.

xiv. a. In our opinion and based on our examination the company has an internal auditsystem commensurate with the size and nature of its business.

b. We have considered the internal audit reports of the company issued till date forthe period under audit.

xv. According to the information and explanations given to us in our opinion duringthe year the company has not entered into any non-cash transactions with its directors orpersons connected with its directors and hence the provision of section 192 of theCompanies Act 2013 are not applicable to the company.

xvi. a. The company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934 therefore the provision of para 3 (xvi) (a) of the Order is notapplicable to the company for the year under audit.

b. The company has not conducted any Non-Banking Financial or Housing Financeactivities during the year therefore the provision of para 3 (xvi) (b) of the Order isnot applicable to the company.

c. The company is not a Core Investment Company (CIC) as defined in the regulationsmade by the Reserve Bank of India. Therefore the provision of para 3 (xvi) (c) of theOrder is not applicable to the company.

d. The Group has no CIC.Therefore the provision of para 3 (xvi) (d) of the Order isnot applicable to the company.

xvii. The company has not incurred cash losses during the financial year covered by ouraudit and in the immediately preceding financial year.

xviii. There has been no resignation of the statutory auditors during the year andaccordingly reporting under para 3(xviii) of the order is not applicable.

xix. According to the information and explanations given to us and on the basis of thefinancial ratios ageing and expected dates of realisation of financial assets and paymentof financial liabilities other information accompanying the financial statements and ourknowledge of the Board of Directors and management plans and based on our examination ofthe evidence supporting the assumptions nothing has come to our attention which causesus to believe that any material uncertainty exists as on the date of the audit reportindicating that the Company is not capable of meeting its liabilities existing at the dateof balance sheet as and when they fall due within a period of one year from the balancesheet date. We however state that this is not an assurance as to the future viability ofthe Company. We further state that our reporting is based on the facts up to the date ofthe audit report and we neither give any guarantee nor any assurance that all liabilitiesfalling due within a period of one year from the balance sheet date will get dischargedby the Company as and when they fall due.

xx. According to the information and explanations given to us and the records of theCompany examined by us provisions of section 135 of the companies Act 2013 are notapplicable to the company. Therefore the provision of para 3 (xx) (a) and (b) of the Orderare not applicable to the company.

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 (“the Act”)

We have audited the internal financial controls over financial reporting of SarthakIndustries Limited as of March 31 2022 in conjunction with our audit of the financialstatements of the Company for the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls Over Financial Reportingissued by the Institute of Chartered Accountants of India. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe Companies Act 2013.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting(the “Guidance Note”) and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls. Those Standards and the GuidanceNote require that we comply with ethical requirements and plan and perform the audit toobtain reasonable assurance about whether adequate internal financial controls overfinancial reporting was established and maintained and if such controls operatedeffectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of internal financial controls over financial reportingassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor's judgment including the assessment of the risks ofmaterial misstatement of the financial statements whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company's internal financial controls overfinancial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A company's internal financial control over financial reporting is a process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A company's internal financial control over financialreporting includes those policies and procedures that (1) pertain to the maintenance ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the company are being made only in accordance with authorizations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorized acquisition use or disposition of thecompany's assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion the Company has in all material respects an adequate internalfinancial controls over financial reporting and such internal financial controls overfinancial reporting were operating effectively as at March 312022 based on the internalcontrol over financial reporting criteria established by the Company considering theessential components of internal control stated in the Guidance Note on Audit of InternalFinancial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.